Encoder purchases enable pay-TV distributor bypass

Content owners, including HBO, Disney/ABC, and Fox are rapidly growing in importance as customers for video encoder and transcoders, according to findings from analyst firm ABI Research. Content owners have always purchased some video encoders for primary distribution – which feed into existing pay-TV systems; however, their investment is increasingly in multi-format transcoders that support direct to consumer distribution.

“Content owners will grow from 11 per cent of the total encoder and transcoder market in 2012 to 17 per cent in 2017, having already passed the importance of telco operators for use in traditional IPTV platforms,” suggests Sam Rosen, practice director at ABI Research. “Their role in distribution stems from both authenticated access offered as part of a retransmission agreement with a classical pay-TV operator, but will also increasingly include advertising supported free-to-wire services and some standalone content-owner bundles.”

The total encoder and transcoder markets grow to become over a $1.5 billion dollar market in 2017, a market led by the combined Arris/Motorola, with Cisco, Ericsson, Harmonic, and Thomson Video Networks all playing a strong role. Envivio leads the file-based multiscreen market while Elemental Technologies leads the live multiscreen market.

The findings are part of ABI Research’s Cloud Video and Video Hardware Research Service.